Proposition 207 UPDATE

Pima weighs zoning freeze over new law

By Erica Meltzer ARIZONA DAILY STAR

"We’re the ones who would have to pay the claims from taxpayers’ money." Chuck Huckelberry County administrator Pima County is considering a freeze on rezonings while it figures out the impact of Proposition 207.

And when that freeze thaws, developers could face new requirements that will mean higher up-front costs and less flexibility. County officials say that’s the only way to protect taxpayers from large payouts under the new law.

"It makes zoning potentially a lot more difficult," County Administrator Chuck Huckelberry said of the proposed changes. "People complain that it takes a long time and is difficult today, and this could make it even more cumbersome and complicated."

"But we’re the ones who would have to pay the claims from taxpayers’ money," he added. Proposition 207 limits government’s use of eminent domain and requires compensation for what are called regulatory takings.

That means that when government adopts new land-use regulations — such as requiring land to be set aside for conservation or limiting the number of houses that could be built — it will have to compensate property owners for the development they didn’t get to pursue. The ballot measure passed with 65 percent of the vote.

But what does Prop 207 have to do with rezonings? The new law requires cities and counties to compensate when they take, but it doesn’t require them to give anything. So cities and counties still have the ability to deny a rezoning without any consequences. But because rezonings are discretionary, cities and counties often use them as an opportunity to wring concessions from developers.

For example, if existing zoning would allow someone to build 20 houses on his property, and he requests a rezoning that would allow him to build 100, the county might grant the rezoning but on the condition he build only 70 houses. Such compromises are common, especially when neighbors object to a project. But Huckelberry said he worries that could be seen as "taking" under Prop 207, meaning the county would have to pay developers for the difference.

Huckelberry asked the county attorney and the supervisors in a memo sent last week whether the county should impose a six-month moratorium on all rezonings and comprehensive plan amendments to study the county’s liability under 207. The moratorium would only affect new applications.

He also asked whether the county should require development agreements in advance of a rezoning. That means developers would have to promise — in a legally binding contract — to develop the land as proposed. They also would waive their rights to seek compensation if not allowed to pursue some different type of project later.

That’s significant because many types of zoning allow a variety of uses. For example, property owners can build houses on land zoned for commercial use. Requiring a development agreement ahead of time means more up-front costs and less flexibility for developers. Land-use attorneys had mixed opinions of the idea.

Frank Bangs at Lewis and Roca said it certainly would inconvenience some of his clients. The process is so slow to begin with that for those in a hurry, an extra six months is a big deal. At the same time, there are a lot of questions about how Proposition 207 will be implemented. He said it makes sense for the county to be cautious.

But Tim Remick of Little, Remick and Capp said he thinks the county is over-reacting. "I don’t see this being used by someone who applied for a rezoning to seek damages," he said of the proposition. "It seems like they are stretching to me." "If they don’t want to allow the uses allowed in the zoning, they shouldn’t grant the rezoning," Remick said.

Lori Lustig, a government liaison with the Southern Arizona Home Builders Association, said her members aren’t surprised by the move. She said many developers already have the zoning they need, and the market has slowed. That will limit the impact of a moratorium. "While the jurisdictions sort out what they want to do and while litigation sorts itself out and while the market sorts itself out, we’ll be taking a hard look at what projects to pursue," she said.

Supervisor Ray Carroll said the moratorium seems like a good idea to him. "There’s no second chances anymore," he said. "With the taxpayers money on the line, it pays to be prudent."

"We’re the ones who would have to pay the claims from taxpayers’ money." Chuck Huckelberry County administrator

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